Perspectives

Looking for some summer reading ideas? Take a stroll through our future-of-health library

Health Care Current | August 6, 2019

This weekly series explores breaking news and developments in the US health care industry, examines key issues facing life sciences and health care companies, and provides updates and insights on policy, regulatory, and legislative changes.

My Take

Looking for some summer reading ideas? Take a stroll through our future-of-health library

By Sarah Thomas, managing director, Deloitte Center for Health Solutions, Deloitte Services LP

I’m a native of Washington, D.C., which is notorious for its hot, sticky summer days and monsoon-like early evening thunderstorms. I never can understand why anyone would choose my fair city for a summer vacation. During the day, the National Mall is often full of sweaty tourists who trudge from one memorial to the next before finally seeking sanctuary in an air-conditioned museum. I tell visitors to embrace the weather—slow down, sit in the shade, and maybe enjoy a glass of iced tea. Sometimes that is enough to make the outdoors bearable (at least until the mosquitos find you).

Whether outside or in, summer is a great time to read. We all had summer reading lists as kids, and vacation offers a nice opportunity to dig into our beach reads or crack a book that has been collecting dust since winter.

The future of health is not in the science fiction section

If you haven’t done so already, I recommend digging into some of the interesting reports and articles we’ve published recently—around the future of health. For these papers and articles, we try to imagine what health is likely to look like in 2040 and during some of the years in between.

  • Forces of change: This report offers our overall vision of where we see the health sector headed based on existing and emerging technologies (and innovations we haven’t yet dreamed up). Over the next 20 years, we expect to see a major transition from treating illness, to keeping people from getting sick in the first place. This change will be fueled by emerging technologies, radically interoperable data, and a highly engaged and motivated population. In addition, the “classic five” silos that make up our current health care system (health plans, health care providers, pharmaceutical companies, medical technology manufacturers, and government/regulators) will transform. Twenty years from now, we expect the value in the health sector will likely be measured by the health and well-being of people, rather than being defined by those five silos. (Pro reading tip—check out the blog from my colleagues Neal Batra and Mike Delone for more on this, and how all of this relates to the music industry).
  • Smart health communities: This report considers the potential impact digital and physical communities can have in keeping people healthy. It includes many interesting initiatives and examples that are already showing some promising results. In Louisville, for example, AIR Louisville made GPS-enabled “smart” inhalers available to individuals who have asthma. Each time an individual took a puff, the inhaler logged the location, time, weather, and pollutants in the air. The individual then received notifications about bad air-quality days and information that helped predict the time and location of asthma attacks. The data were also used to calculate the health care costs of poor air quality and was shared with city officials to understand where to concentrate air-purification efforts.
  • The future of aging: There are already nearly as many millennials (71 million) as there are baby boomers (74 million).1 Just as baby boomers have rejected many of the senior-focused products and services used by their parents, the generations that follow will likely have their own unique needs and expectations. Digital health technologies will likely help people stay in their homes longer as they age, especially if they’re paired with solutions (digital or otherwise) that work to solve non-medical health challenges, such as loneliness, by matching people who have common interests and encouraging them to participate in activities together in a non-virtual way.
  • The digital transformation of biopharma: Before biopharmaceutical manufacturers can get to the future of health that we envision, they should first make the leap to the digital world. Massive amounts of patient data are already being generated by wearable sensors and monitors, at-home diagnostics, and digital therapeutics. Digital therapeutics are emerging as alternatives or supplements to drug interventions in disease areas ranging from asthma to Alzheimer’s to chronic obstructive pulmonary disease, and diabetes.

We have also published several short articles that indicate the future of health might already be here. In case you missed them, here are three recent “Breaking Boundaries” stories from the Health Care Current:

Reading lists, both paper and digital

I recently discovered the Goodreads app, which is helping me manage the list of books I want to read. I’ve always embraced technology that solves for a problem—in this case, trying to remember all the books that friends have recommended, or books I want to read based on reviews that I found particularly interesting. I’m using it less for its potential social aspect (I just have three friends on it), though I see its potential there. I also enjoy the gamification aspect: the app has a 20-book summer reading challenge. I’m up to 16, so on pace to meet the challenge (and ahead of my friends, it turns out).

While I’m using this new technology to manage my lists, I continue to rely on old technology—such as the local library and the little free libraries in our neighborhood—to find the books.

And another fun read

I recently finished The Lost Cyclist, by David Herlihy. This novel pulls together the early evolution of bicycles—from the high-wheel bikes of the late 1800s to the so-called “safety bicycles” that followed. The book includes stories about some of the first intrepid American cyclists to “girdle” or circle the world. It was fun to imagine how or why someone would even contemplate such an endeavor—without smart-phone navigational tools or apps to translate languages (not to mention the lack of paved roads or comfortable bike seats).

While technology has solved many of the problems those pioneers faced (I wonder what they would think of our modern-day gear) there are still risks—think of the traffic alone. And even if we don’t call the bad guys “brigands” anymore, globe-circling cyclists still face threats today. By 2040, maybe those issues will have also been solved by technology.

Happy summer reading!

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1 U.S. Census Bureau population projections

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In the News

CMS proposes public disclosure of negotiated hospital prices

On July 29, the US Centers for Medicare and Medicaid Services (CMS) released the 2020 Outpatient Prospective Payment System (OPPS) & Ambulatory Surgical Center (ASC) proposed rule. The proposed rule follows the administration’s recent executive order on price and quality transparency (see the July 16, 2019 Health Care Current). In January, hospitals began publishing price information for specific services including all drugs and biologics. CMS’s proposed rule outlines several new price-transparency requirements for hospitals, including:

  • Requiring hospitals to publicize, in a clear and readable format, their “standard charges”—both gross charges and the payment rates that health plans have negotiated with them—for all items and health services.
  • Although hospitals would have to make all standard charges public, they also would need to create consumer-friendly information around 300 “shoppable” services, or services that patients schedule in advance, such as x-rays, imaging and laboratory tests, and information on ancillary services that typically accompany those services (even if not paid for as a bundle). According to CMS, these charges must be displayed prominently online and made available in writing (upon request). Hospitals would have to update this information annually.
  • Requiring that hospitals publish gross charges and payer-negotiated prices online in a machine-readable format so developers can incorporate them into price-transparency tools, and consumers can compare prices among hospitals.
  • Enforcing compliance with these price-transparency measures by monitoring, auditing, and penalizing hospitals $300 per day if they violate the requirements.

If finalized, the nation’s approximately 6,000 Medicare-participating hospitals will be required to publish these prices beginning January 1, 2020. The trade group America’s Health Insurance Plans (AHIP) criticized the requirement and said it would force hospitals to disclose negotiated charges between hospitals and health plans. AHIP suggested that the new rules could cause health insurance premiums to increase. The American Hospital Association (AHA) also expressed disapproval for the proposal, citing concerns that it could reduce competition among commercial health insurers.

(Source: CMS, CY 2020 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Proposed Rule (CMS-1717-P), July 29, 2019)

HHS, FDA announce plan for importation of prescription drugs

On July 31, the US Department of Health and Human Services (HHS) and the US Food and Drug Administration (FDA) announced the Safe Importation Action Plan, which outlines two potential pathways for importing certain prescription drugs originally intended for foreign markets.

  • Forthcoming rulemaking will create pilots and demonstrations: HHS and FDA would publish a notice of proposed rulemaking outlining requirements for pilot/demonstration projects from states, drug wholesalers, and pharmacists on importing drugs from Canada. The demonstrations would not include controlled substances, biological products, infused drugs, intravenously injected drugs, drugs inhaled during surgery, and certain parenteral drugs. The notice would also specify conditions to ensure that imported drugs are safe, can be tracked and traced, and are properly labeled. The proposed project submissions would have to show that they would achieve significant cost savings for American consumers.
  • Guidance for manufacturers: FDA would issue guidance providing recommendations to manufacturers that want to import versions of approved drugs now sold internationally. Manufacturers would use a new National Drug Code (NDC) for those products, which could allow them to be sold at a lower price than required under existing distribution contracts. Under this pathway, pharmaceutical companies would be required to establish that the foreign version of the drug is the same as its US counterpart and that it is properly labeled for sale in the US.

In a statement released the same day, HHS Secretary Alex Azar explained how this plan builds on the administration’s blueprint to combat high drug prices and lower out-of-pocket costs for consumers. The plan also signals a shift in posture on reimportation. The White House has recently expressed interest in drug importation from Canada and praised state efforts to address the issue (see the June 18, 2019 Health Care Current).

Several pharmaceutical and biologics manufacturers have criticized the importation plans. Pharmaceutical Researchers and Manufacturers of America (PhRMA) noted that companies would prefer to work on price policies in the US. The biotech organization BIO expressed concern for ensuring consumer safety. On Capitol Hill, a few Republican lawmakers offered tentative support for the proposal, while some Senate Democrats indicated their preference for allowing the US government to negotiate drug prices instead of importing drugs from foreign countries. Some Canadian officials have previously expressed opposition to any drug-importation plan that could cause drug shortages or raise the cost of medications in their country.

(Sources: US Department of Health and Human Services, HHS Announces New Action Plan to Lay Foundation for Safe Importation of Certain Prescription Drugs, July 31, 2019; FDA and HHS, Safe Information Action Plan, 2019)

 

Health care coverage takes center stage at Democratic debates

Health care coverage was a major focus among the 20 presidential candidates who appeared at last week’s Democratic debates, and universal coverage has emerged as a key component in many of their health policy platforms.

On the first night, Senators Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) defended their proposals on “Medicare for All.” Sanders emphasized that Canada has universal care and spends significantly less on health care than the US. Warren’s plan supports eliminating private insurance over the long run. In the meantime, however, she said lawmakers need to expand access to free or lower-cost health coverage.

Some of the candidates argued that upending the entire system—and getting rid of employer-based coverage—would be too disruptive for Americans. Former Representative John Delaney (D-Md.) noted that many Americans like their employer coverage and don’t want it taken away by the government.

On night two, former Vice President Joe Biden and Senator Kamala Harris (D-Calif.) debated their plans. Biden’s plan would build on the Affordable Care Act (ACA) by making government-sponsored coverage available to people who do not have access to—or who chose not to be covered by—an employer-sponsored plan. His plan would cap every American’s premium at 8.5 percent of their annual income. Harris, by contrast, wants to transition everyone into a public or privately run Medicare plan. This would be phased in over 10 years (instead of Sanders’ proposed phase-in of four years).

In the months ahead, the candidates should expect more questions about how their proposals would expand health coverage, how much of the current system would be preserved, and how they intend to pay for it.

Federal judge strikes down New Hampshire’s Medicaid work requirements

On July 29, a US District judge struck down New Hampshire’s plan to impose work requirements on Medicaid beneficiaries. HHS approved the requirements last November. Under the plan, beneficiaries would have been required to participate in 100 hours of employment activities per month to maintain benefits. US District Judge James Boasberg ruled against the requirement after state officials concluded that nearly 17,000 beneficiaries would have been at risk of losing coverage. The same judge struck down work requirements in two other states—Arkansas and Kentucky—during the past year (see the April 2, 2019 Health Care Current).

Report recommends improving HCAHPS patient-experience survey

In a new report, researchers from five hospital associations analyzed the effectiveness of the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey as a tool for gathering data about the patient experience during hospital stays. Hospital and health system patient experience leaders say the survey should be updated to reflect evolving patient expectations and changes to the care delivery system. The annual HCAHPS survey is aimed at helping patients make more informed decisions about their care.

According to the report, patient response rates continue to fall each year (33 percent in 2008 vs. 26 percent in 2017), which can affect the validity of the data. Researchers made several recommendations for updating the HCAHPS survey, including:

  • Adding a digital option to reach a broader population of patients 
  • Shortening the survey (it is now 32 questions) 
  • Changing the survey questions to reflect the shift to value-based care and evolving patient priorities 
  • Continuing to re-evaluate the survey over time

(Source: Modernizing the HCAHPS Survey: Recommendations from Patient Experience Leaders, July 25, 2019)

Breaking Boundaries

Health plans that address the social needs of members report lower care costs

Medicaid beneficiaries who were screened for and referred to services that address social needs experienced a drop in inpatient admission rates and had both shorter hospital stays and fewer emergency-room visits, according to a new study. AmeriHealth Caritas, a Medicaid managed care organization (MCO) that serves 5.1 million beneficiaries in 11 states and the District of Columbia, published its analysis early this month.

The study included about 1,000 members who had at least one chronic illness. The research team analyzed claims data and hospital utilization rates from the last quarter of 2018. The analysis also included the members’ responses to survey questions about social needs, including social support, health literacy, access to healthy food and transportation, and other factors outside the traditional health care system. The results showed that health literacy, food insecurity, and a lack of transportation to medical facilities were most prevalent among high-risk members.

AmeriHealth Caritas relies on care-management teams and community health navigators to engage members who have certain risk factors and works to increase their access to care and improve their health experience. Along with collecting health data, the company also gathers member information related to economic, social, and environmental barriers to care. Members receive health care services and clinician visits in their homes, and the care team places a strong emphasis on addressing social needs. According to the study, the program has been successful in addressing the needs of high-risk members. When high-risk patients engaged with community services alongside clinical care, they experienced:

  • A 26 percent drop in hospital admissions
  • A 27 percent drop in inpatient days
  • A 10 percent reduction in emergency department visits

WellCare Health Plans, another Medicaid MCO, also introduced a program that addresses the social needs of its members. According to a 2018 study, WellCare’s HealthConnections program reduced spending by 11 percent after one year. The program refers Medicaid and Medicare Advantage (MA) patients to community services such as transportation services to take them to appointments and programs to help them pay utility bills. The researchers examined patient costs among members who were successfully connected to social services through the program and compared those costs to a control group of members who also received referrals but didn’t have their needs met. Both groups saw lower care costs in the year following social service referrals, but there was an additional 10 percent reduction for those who had their social needs met. The group that said all their social needs were met experienced an 11 percent reduction—or $2,601—in total health care costs in the first year. Those who said their needs were not met experienced only a 1 percent reduction in total care costs during the same period.

As evidence continues to link social needs to health outcomes and costs, policymakers are looking to pass legislation to help expand health programs that address social needs. A bipartisan bill recently introduced in the House would authorize up to 25 grants to state and local entities that want to address the social health needs of Medicaid enrollees. The bill calls for HHS to form a council that would recommend criteria for the grants, identify ways to streamline funding across federal programs, provide grant assistance to states, send an annual report to Congress, develop evaluation guidelines for intervention, and coordinate with other cross-agency initiatives.

RELATED: To learn what Medicaid MCOs and MA plans are doing to address social needs among their enrollees, the Deloitte Center for Government Insights and the Deloitte Center for Health Solutions interviewed executives and leaders from 14 MCO and MA plans for the report, Addressing the social determinants of health in Medicare and Medicaid enrollees. Our interviews revealed some promising strategies that health plans are using to address social needs among their Medicare and Medicaid enrollees. These include identifying social needs through screening, connecting members to services through one-on-one support programs, establishing strong partnerships through formal contracts and value-based-care arrangements, and exploring better ways to monitor and evaluate interventions. Looking ahead, many health plans are also investing in the social needs of communities by donating money to organizations that address issues such as housing and food insecurity, funding programs and evaluations, and assessing gaps in community resources. Some health plans are considering technologies such as mobile apps and virtual care while maintaining one-on-one support programs for high-need and high-risk members. Many health plans are also interested in adopting data platforms to share data and evaluate interventions more easily, but say they need to overcome significant technological and operational challenges before they can do so.

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